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Kerr-McGee makes second GOM deepwater find

The Nansen prospect in East Breaks Block 602 in the Gulf of Mexico is the second discovery in the area made by Kerr-McGee this year. The 11,990-ft discovery well encountered about 140 ft of gas condensate pay. The well is located in 3,680 ft of water, about 8 mi from the company’s recently announced North Boomvang discovery in East Breaks 643. Kerr-McGee will directionally drill a 12,400-ft appraisal well in an adjacent updip fault block. Evaluation of well data and 3-D seismic will continue to select additional appraisal sites to evaluate the large area. The company expects to spud a third well by the end of the year to further delineate its latest discovery.

European Commission approves mega mergers

On September 29, the European Commission (EC) approved the merger of Exxon and Mobil. The two companies have accepted the terms and conditions included in the agreement with the Commission. Europe will continue to represent a substantial portion of the merged company’s upstream, chemical and downstream businesses. However, under the EC’s conditions, the companies must divest assets in certain market segments. On the same day, the EC also gave its approval of the proposed combination of BP Amoco and ARCO, on the condition that the companies dispose of certain ARCO gas infrastructure assets in the UK Southern North Sea. BP Amoco and ARCO have agreed.

Triton discovers oil in West Africa

Triton Energy made a significant oil discovery on La Ceiba field in Equatorial Guinea. On test, the Mbini-1 well flowed 12,401 bopd. Results, however, were constrained by the limited capacity of surface testing equipment. Preliminary analysis of the well’s test data indicates an initial production rate of 20,000 bopd upon completion. Located 22 mi off the continental coast in Triton’s Block G, the well was drilled to a 9,700-ft TD in about 2,200 ft of water. Triton President James C. Musselman said, "The Mbini-1 discovery proves the existence of a working hydrocarbon system in the previously under-explored Rio Muni basin and opens up what may prove to be a very significant offshore West African hydrocarbon fairway." Beginning in the fourth quarter of this year, the company plans to drill an appraisal well and acquire a 740,000-acre 3-D seismic survey.

UMC drills for oil off Pakistan

For the first time in 22 years, drilling began off the coast of Pakistan’s Baluchistan province last month. U.S. oil company, UMC, plans to drill three wells over the next six months, while taking advantage of a calm sea weather window. Pakistan has issued 49 exploration licenses since 1996 (nine offshore), and plans to sign two more agreements for exploration in waters exceeding 6,562 ft. The country has had six major gas discoveries in the last two years and plans to boost its domestic gas production to 2.5 Bcfgd by the end of the year, from the current 1.8 Bcfgd. The government and private oil companies have been divided on how to fix a price formula for the newly discovered gas; but Gulfraz Ahmed, secretary to the Ministry of Petroleum and Natural Resources, said a pricing mechanism has been worked out.

Senate stops a gas pump tax hike

A bi-partisan super-majority of the U.S. Senate voted to overcome a filibuster and pass an amendment to the fiscal 2000 Interior Appropriations bill — sponsored by Senators Kay Bailey Hutchinson (R-Tx) and Pete Domenici (R-NM) — that will block a federal agency’s move to increase gas taxes. Steady tax hikes at the pump since 1990 total 41 cents on every $1.29 paid for a gallon of gas. The Hutchison-Domenici amendment also blocks the Mineral Management Service (MMS) from unilaterally boosting royalty rates paid by oil and gas companies that drill on federal land. The amendment calls for a one-year halt during which the MMS will examine a more fair method to figure royalty rates.

Exxon begins producing from North Sea field

Exxon affiliate Esso Norge AS (ENAS) has begun oil production at Balder field in Block 25/11-PL001, located 115-mi west of Stavanger in the Norwegian North Sea. The field is expected to reach a peak of about 100,000 bpd from an estimated 170 million bbl of recoverable oil. Balder has been developed through 14 subsea wells, including 10 producers. Wells are tied back to the Balder Floating Storage Unit, with a storage capacity of 380,000 bbl of oil, which is offloaded via shuttle tankers transporting the oil to markets. Over the last several years, ENAS has identified additional oil resources in the Utsira High area, near Balder field, through an extensive exploration and drilling program. The company has conducted studies to assess the possibility of further developments in the area using Balder facilities.

Significant development well drilled in Ecuador

In Ecuador’s Oriente region, CMS Oil and Gas drilled a significant development well in Ginta field on Block 16. Initial results from Ginta B-4H well, located about 160-mi southeast of Quito, yielded flowrates of up to 17,750 bbl of oil and 550 bbl of water per day. The development well was the first horizontal well in Ginta field. It was drilled to a measured depth of 9,896 ft with 1,720 ft of lateral. CMS holds a 14% interest in Block 16, which covers about 500,000 acres, and in the nearby Tivacuno, Bogi and Capiron fields. The block and fields are being developed by a joint venture comprising YPF Ecuador, Overseas Petroleum and Investment Corp. of Taiwan, Murphy Ecuador Oil Co. and CANAM Offshore Ltd. Due to constraints through the trans-Ecuadorean pipeline system, Block 16 and its nearby fields are currently producing 45,000 bopd. A pipeline expansion, expected to be completed by early 2001, will increase daily production significantly.

Copyright © 1999 World Oil
Copyright © 1999 Gulf Publishing Company